QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended September
30, 2012

Commission File No. 000-51632

VIPER POWERSPORTS INC.

(Exact name of registrant as specified in
its charter)

Nevada

41-1200215

(State or other jurisdiction of incorporation or organization)

(IRS Employer Identification No.)

2458 W. Tech Lane, Auburn Alabama

36832

(Address of principal executive offices)

(Zip Code)

(334) 887-4445

(Issuer’s telephone number)

Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of
“large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2
of the Exchange Act.

Large Accelerated filer ¨

Accelerated filer ¨

Non-accelerated filer ¨ (Do not check if a smaller reporting company)

Smaller reporting company x

Indicate by check mark whether the registrant is a shell company
(as defined in Rule l2b-2 of the Exchange Act). Yes ¨ No x

The number of shares of common stock outstanding was 52,182,639
as of September 30, 2012

The consolidated balance sheet as of September 30, 2012, the
consolidated statements of operations for the three months and nine months ended September 30, 2012 and 2011 and the consolidated
statements of cash flows for the three months and nine months ended September 30, 2012 and 2011 have been prepared by Viper Powersports
Inc., (the ”Company”) without audit. In the opinion of management, all adjustments (consisting only of normal recurring
accruals) necessary to present fairly the financial position, as of September 30, 2012 and results of operations and cash flows
for the three months and nine months ended September 30, 2012 and 2011 have been made.

Certain information and footnote disclosures normally included
in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have
been condensed or omitted. These financial statements should be read in conjunction with the Company’s financial statements
and notes thereto included in the Annual Report on Form 10-K of the Company for the fiscal year ended December 31, 2011.

For comparison, the Company’s Form 10-Q for the quarter
ended September 30, 2011 was restated. When comparative data is used in this statement, the Company is referencing the restated
Form 10-Q/A

B. Going Concern

The accompanying financial statements have been prepared assuming
the Company will continue as a going concern. The Company has a positive working capital position of $621,424 as of September 30,
2012. However, future current cash and cash available may not be sufficient to fund operations beyond a short period of time. These
conditions create uncertainty as to the Company’s ability to continue as a going concern. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

C. Common Stock Transactions

During the three months ended March 31, 2012, the Company issued
666,666 shares of common stock for $100,000 in cash less $31,718 of cost recorded in general and administrative.

During the three months ended March 31, 2012, 1,019,801 Preferred
Shares have been converted into 3,824,255 common shares.

During 2011, the Company issued 1,386,469 Convertible Preferred
Shares at a price of $0.75. Based on the last five trading days of December 2011, a conversion price of $0.20 was set. The conversion
rate was 3.75 Common Shares for one (1) Preferred Share.

During the three months ended June 30, 2012, the Company issued
2,333,334 shares of common stock to thirteen accredited investors for $350,000 in cash less $29,169 of cost recorded in general
and administrative.

During the three months ended June 30, 2012, the Company issued
500,000 shares of common stock to two accredited investors for $75,000 for conversion of short-term notes.

During the three months period ended June 30, 2012, 366,667
Preferred Shares have been converted into 1,375,001 common shares. During 2011, the Company issued 1,386,469 Convertible Preferred
Shares at a price of $0.75. Based on the last five trading days of December 2011, a conversion price of $0.20 was set. The conversion
rate was 3.75 Common Shares for one (1) Preferred Share.

During the three months period ended June 30, 2012, the Company
issued 2,426,668 shares of unregistered common stock to five accredited investors in consideration for their conversion of debt
owed to them by the Company in the total amount of $364,000.

6

Viper Powersports Inc.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL
STATEMENTS

September 30, 2012

D. Common Stock Transaction for Services

During the three months ended March 31, 2012, the Company issued
500,000 shares of common stock to one accredited investor for $135,000 of services recorded as an expense in general and administrative.
The market closing price on this date was used to value the stock issued for services.

During the three months ended June 30, 2012, the Company issued
532,000 shares of common stock to three accredited investors for $149,640 of services recorded as an expense in general and administration.
The market closing price on this date was used to value the stock issued for services.

As an inducement to Precious Capital LLC to make the loan (see
note F below) to Viper Motorcycle Company, the Company issued a total of 9,694,128 unregistered shares of its common stock to Precious
Capital LLC, which common shares were offered and sold by the Company in reliance upon the exemption from registration set forth
in Section 4(2) of the Securities Act of 1933, as amended.

As an inducement to three accredited investors to convert their
notes, the Company issued 1,255,000 shares of common stock for a value of $414,150.

During the three months ended September 30, 2012, the Company
issued 383,333 shares of common stock to two accredited investors for $80,500 of services recorded as an expense in general and
administration. The market closing price on this date was used to value the stock issued for services.

E. Warrants for Services

During the three months ended March 31, 2012, the Company issued
100,000 warrants for shares of common stock for $27,971 of services recorded as an expense in general and administration. The Company
valued the warrants issued using the Black-Scholes model.

During the three months period ended June 30, 2012, the Company
issued 1,359,550 warrants for shares of common stock for $313,133 of services recorded as an expense in general and administration.
The Company valued the warrants issued using the Black-Scholes model.

F. Loans

The Company entered into two 180-day loan agreements for $100,000
each from January 1, 2012 through March 31, 2012. These loans are convertible and carry a 12.0% interest rate. Each agreement also
required the Company to issue 650,000 warrants to purchase the applicable number of shares of common stock at $.15 per share. The
Company valued the warrants issued using the Black-Scholes model. The relative fair value method was used to allocate the proceeds
between the warrants and the loans, resulting in a debt discount, which is then accreted over the life of the loans. Any remaining
unamortized debt discount at the time of conversion has been accreted as an expense. These loans were converted in April 2012.

On March 15, 2012, the Company repaid the Convertible Promissory
Note to Asher Enterprises, Inc. with a principal amount of $65,000 with accrued interest and prepayment option fees. The discounted
carrying value on the Balance Sheet was $33,622.

The Company entered into three (3) short-term loan agreements
for a total of $214,000 with related parties from January 1, 2012 through March 31, 2012. The instruments are non-interest bearing.

On March 22, 2012, the Company received $25,000 from an accredited
investor from a private placement. As of March 31, 2012, the shares were not issued and were classified as a payable. The loan
was converted into share during the second quarter of 2012.

On April 24, 2012, Viper Motorcycle Company (“VMC”),
as Borrower and being a wholly owned subsidiary of registrant Viper Powersports Inc., entered into a Loan and Security Agreement
(the “Loan Agreement”) with Precious Capital LLC , of New York City, as Lender. The Loan Agreement provides funding
through advances to VMC under a line of credit not to exceed $6,000,000, with interest on outstanding principal payable at an annual
rate of 15% per annum. All outstanding principal of this loan and any accrued interest is due to Lender in full, thirty-six (36)
months from the date of the Loan Agreement. The outstanding principal of this loan may be prepaid by VMC, in whole or in part,
at any time.

7

·

Upon closing this loan, VMC received an initial loan advance of $2,500,000. The Loan Agreement required the funds from this
initial advance to be used by VMC as follows: payment of outstanding debt of $280,000 including $80,000 owed to a director of the
Company; payment of $640,000 to acquire the assets of Precision Metal Fab Racing, a manufacturer and marketer of high performance
motorcycle components based in suburban Minneapolis; prepaid payment of loan interest to the Lender of $375,000; payment of $330,000
to complete acquiring engine development IP technology from Ilmor; payment not to exceed $450,000 for manufacturing equipment and
tooling; payment of $180,000 for loan brokerage commissions; payment not to exceed $128,000 for motorcycle components inventory
and other immediate operational expenditures; and the balance for miscellaneous permitted expenditures including payment of professional
and other expenses of VMC and the Lender related to this loan transaction and its closing.

·

Under the terms of the Loan Agreement, any further advances to VMC beyond the initial $2,500,000 shall be in the Lender’s
sole and absolute discretion, and no advance may be requested by VMC after April 24, 2014. The loan terms also require that at
no time shall the outstanding balance of this loan exceed a “Balancing Formula” as defined in the Loan Agreement, which
formula approximates 60% of the values of certain defined tangible and intangible assets of VMC and the Company.

·

To provide the required collateral for this loan, both VMC and the Company entered into various security, pledge and guaranty
agreements to guarantee payment to the Lender and secure the Lender with all tangible and intangible assets of VMC and the Company
as set forth in the Loan Agreement and its supporting documents, including the Company’s 100% ownership of VMC. In addition,
the future payment to the Lender of all outstanding principal and accrued interest of this loan was guaranteed unconditionally
by the Chief Executive Officer and Chief Financial Officer of the Company.

·

The Loan Agreement also contains numerous representations, warranties and covenants of VMC, detailed terms for the opening
and operation of certain banking Special Deposit Accounts as required by the Lender, default provisions and other standard loan
contract provisions.

·

As an inducement to the Lender to make this loan to VMC, the Company issued a total of 9,694,128 unregistered shares of its
common stock to the Lender, which common shares were offered and sold by the Company in reliance upon the exemption from registration
set forth in Section 4(2) of the Securities Act of 1933, as amended. The cost of this issuance was capitalized to deferred financing
costs and will be amortized on a straight-line basis over the life of the loan as additional interest.

·

The Loan Agreement also provides that none of the common stock of the Company owned by the Lender or by the Chief Executive
Officer and Chief Financial Officer of the Company can be sold or otherwise disposed of during the three-year term of this loan.

On July 10, 2012, per the April 24, 2012, Loan Agreement with
Precious Capital LLC, VMC was advanced $345,000 under the same terms.

On August 22, 2012, per the April 24, 2012, Loan Agreement with
Precious Capital LLC, VMC was advanced $195,000 under the same terms.

On September 10, 2012, per the April 24, 2012, Loan Agreement
with Precious Capital LLC, VMC was advanced $160,000 under the same terms.

8

Viper Powersports Inc.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL
STATEMENTS

September 30, 2012

G. Inventories

Inventories are stated at the lower of cost or market. Cost
is determined by using first-in, first-out method (FIFO). Demonstration motorcycles are stated at manufacturing cost with reserves
recorded to reflect their net realizable value. The Company reviews inventory for obsolescence and excess quantities to determine
that items deemed obsolete or in excess are appropriately reserved. Inventory components at September 30, 2012 are as follows:

September 30, 2012

VMC

PMFR

Total

Raw material

$

0

$

10,000

$

10,000

Build components

592,957

0

592,957

Finished goods

78,412

256,759

335,171

671,369

266,759

$

938,128

H. Subsidiary purchase

On April 24, 2012, the Company established a subsidiary, PMFR,
Inc. (“PMFR”). The subsidiary then purchased assets from Precision Metal Fab Racing, a sole proprietor for $640,000
in cash. The acquisition of fixed assets, inventory and intangible was recorded as following:

Fixed assets (estimated life of 5 years)

$

300,000

Intangible (customer list) (estimated useful life of 5 years)

85,000

Inventory

215,000

Total purchases

$

600,000

Finder’s fee

40,000

Total purchase price

$

640,000

I. Intangibles

Under the Ilmor/Viper Contract, Ilmor had assumed all design,
development, testing, quality control and manufacturing with respect to an upgraded Ilmor-designed Viper V-Twin engine. Ilmor has
completed design and development operations and is now producing models of this engine based on specifications jointly developed
by Ilmor and Viper. Under a payment schedule extending through November 2012, the Company was to pay Ilmor a total of $745,000
for the design, development and testing of this V-Twin engine. On April 24, 2012 Viper paid Ilmor the final $330,000 installment
for the development cost. The Company will amortize this intangible over the next 60 months.

J. Subsequent Events

The Company has evaluated subsequent events from September 30,
2012 through the date the original financial statements were issued and determined that there are the following events to disclose:

Loans

On October 10 2012, per the April 24, 2012, Loan Agreement with
Precious Capital LLC, VMC was advanced $1,725,000 under the same terms.

The Company has made a pre-payment of $1,000,000 to Ilmor for
the purchase of future engines and components. This amount will be carried a prepaid other on future financial statements.

9

Item 2: Management’s Discussion and Analysis

The following discussion should be read and considered along
with our consolidated financial statements and related notes included in this 1O-Q. These financial statements were prepared in
accordance with United States Generally Accepted Accounting Principles (U.S. GAAP). This discussion and analysis contains forward-looking
statements that involve risks, uncertainties and assumptions. Our actual results may differ substantially from those anticipated
in these forward-looking statements as a result of various factors including those set forth in the “Risk Factors”
section of our Form 10-K filing for December 31, 2011.

Business Development Overview

Viper Powersports Inc., formerly ECCO Capital Corporation (“ECCO”),
was incorporated in Nevada in 1980. ECCO mergered with Viper Motorcycle Company(“VMC”) in 2005 through a stock exchange
acquisition, incident to which it changed its name to Viper Powersports Inc.

Effective March 31, 2005, Viper Powersports Inc. acquired all
of the outstanding capital stock of VMC, a Minnesota corporation, resulting in VMC becoming a wholly-owned subsidiary of Viper
Powersports Inc. For accounting and operational purposes, this acquisition was a recapitalization conducted as a reverse acquisition
of Viper Powersports Inc. with VMC being regarded as the acquirer. The stock exchange for this reverse acquisition was affected
on a one-for-one basis, resulting in the stockholders of VMC exchanging all of their outstanding capital stock for an equal and
like amount of capital stock of Viper Powersports Inc. This resulted in the former shareholders of VMC acquiring approximately
94% of the resulting combined entity.

Viper Performance Inc. was incorporated by us in March 2005
as a wholly-owned Minnesota corporation. We organized and incorporated Viper Performance Inc. for the purpose of receiving and
holding engine development technology

PMFR, Inc. was incorporated by us in April 2012 as a wholly-owned
Minnesota corporation. It was organized for the acquisition of Precision Metal Fab Racing’s assets. The subsidiary was formed
to produce high quality chassis and suspension and other components and parts, many of which are CAD designed and CNC machined
from high-grade billet aluminum stock.

As used herein, the terms “we”, “us”,
“our”, and “the Company” refer to Viper Powersports Inc. and its two wholly-owned subsidiaries, unless
the context indicates otherwise.

Since our inception, we have been in the business of designing,
developing and commencing commercial marketing and production of premium custom V-Twin motorcycles. Our motorcycles are distributed
and sold under our Viper brand through a nationwide network of independent motorcycle dealers. Marketing of our motorcycles is
targeted toward the upscale market niche of motorcycle enthusiasts who prefer luxury products and are willing to pay a higher price
for enhanced performance, innovative styling and a distinctive brand. We believe there is a consistently strong demand for upscale
or luxury motorcycle products like our American-styled classic Viper cruisers and our premium V-Twin engines. For example, the
prestigious upscale Robb Report magazine publishes a Robb Report Motorcycling magazine bi-monthly, which is targeted exclusively
to luxury motorcycle products.

We have completed the development and extensive testing of proprietary
V-Twin engines including actual performance testing of the engines on our various motorcycles models, and we have been very satisfied
with their performance while powering our motorcycles during all kinds of street and highway running conditions. Our proprietary
V-Twin engines were designed and developed by Melling Consultancy Design (MCD), a leading professional engine design and development
firm based in England.

After undergoing an extensive engine emissions testing program
for an entire year conducted by a leading independent test laboratory, our proprietary V-Twin engines satisfactorily passed and
complied with all noise and pollution emissions requirements of both the federal Environmental Protection Agency (EPA) and the
more stringent emissions requirements of the California Air Resources Board (CARB). Satisfying these standards constitutes a touchstone
achievement for the Company that we believe places us in a commanding competitive position in the upscale custom motorcycle market.

We commenced commercial marketing, very limited production and
commercial shipment of Viper motorcycles prior to our move to Auburn, Alabama. With the completed relocation to Auburn the Company
has started substantial stocking of inventory and commenced production of its 2012 motorcycles.

Strategic Engine Development Joint Venture

In January 2010, the Company’s subsidiary, VMC, entered
into a three-year Motorcycle Engine Manufacture and Supply Agreement with Ilmor Engineering Inc. (the “Ilmor/VMC Contract”).
Ilmor Engineering Inc. (“Ilmor”) has been engaged for over 20 years in the design, development and manufacture of high-performance
engines, and Ilmor’s extensive precision engineering and manufacturing facilities are located in suburban Detroit, Michigan.
The Company is very pleased to have completed this strategic and valuable Ilmor/VMC Contract, since Ilmor is widely recognized
as one of the most successful race-engine design and manufacturers.

10

Under a previous written contract entered into by Ilmor and
VMC in 2009, Ilmor began assembling all V-Twin engines used by VMC and since then Ilmor has conducted all of the Company’s
engine product assembly. The initial 2009 contract also contained a product development segment whereby Ilmor evaluated our V-Twin
engine to determine whether the parties should engage in a future joint venture to develop and produce an upgraded model of the
VMC engine. Ilmor’s evaluation of our V-Twin engine through the initial contract was favorable, and accordingly resulted
in the current Ilmor/VMC Contract, which provides for the exclusive manufacture and supply by Ilmor of a VMC engine designed by
Ilmor.

The Company has approved and is well satisfied with the most
improved and upgraded Ilmor-designed VMC engine, and accordingly has ordered and obtained initial commercial shipments of these
engines. Ilmor agrees to manufacture and supply all V-Twin requirements of VMC and in turn the Company must purchase all its engines
exclusively from Ilmor. Ilmor will bear the cost and expense of all tooling, parts and components to manufacture and supply VMC
engines until finished engines are invoiced and shipped to the Company. So long as VMC satisfies certain minimum annual engine
purchase requirements, Ilmor shall not develop, manufacture or sell a similar V-Twin engine for itself or any third party.

These Ilmor-designed VCM engines are labeled with an Ilmor brand,
for which the Company has been granted a non-exclusive paid-up license to use the Ilmor Mark in connection with sale and distribution
of Viper engines. All intellectual property rights related to any Ilmor Marks, however, continue to be owned exclusively by Ilmor.
Engine pricing to be paid to Ilmor by VMC will be determined annually based on the actual Bill of Materials for components, labor
and assembly costs incurred by Ilmor, plus a reasonable mark-up percentage.

On October 8, 2012, VMC and Ilmor entered in to an amended and
updated agreement known as the Motorcycle Engine Manufacture and Supply Agreement (“the Ilmor/VMC Updated Contract”).

The Ilmor/VMC Updated Contract replaces and updates the earlier
agreement made between the parties. The updated agreement has been expanded to a term of five (5) years. In addition, VMC has made
a pre-payment to Ilmor of $1,000,000 for the purchase of future engine and components. Under the terms of the Ilmor/VMC Updated
Contract, Ilmor will use “best efforts” to improve the costs of engine components in a shared savings cost reduction
program, which, the Company believes, will result in a substantial cost benefit pass through unto VMC.

Plan of Operation

Our long-term business strategy or goal is to become a leading
developer and supplier of premium V-Twin heavyweight motorcycles, V-Twin engines, and ancillary motorcycle aftermarket products.
In implementing this strategy, we intend to execute the following matters for the next twelve months:

Continuecommercializing the Diamondback & Mamba

Our primary focus during the next twelve months is to complete
implementing and improving production operations for our motorcycle products to be manufactured by us effectively on a commercial
scale. We have completed our production assembly set-up including shelving, railings and individual station equipment necessary
for efficient factory production operations. We also have obtained all vendors, suppliers or subcontract third parties needed for
obtaining components, parts and raw materials for our motorcycles and having them painted after assembly, and we will continue
to identify and obtain alternate sources for material components.

Continue Design and Development

We will complete development and testing of our Mamba model
and a Viper three-wheeled “trike” in order to offer the Mamba commercially as soon as possible in early 2013 and the
“trike” soon thereafter.

Expansion of Distribution Network

We will continue to identify and recruit qualified independent
motorcycle dealers to become VMC dealers until we achieve our goal of having a nationwide network of VMC dealers. We will only
select full-service dealers which we determine possess a successful V-Twin motorcycle sales history, a solid financial condition,
a good reputation in the industry, and a definite desire to sell and promote VMC products. We have engaged with future international
distributors for Europe and Australia.

Expansion of Sales and Marketing Activities

We will continue and expand upon our marketing activities which
are primarily focused toward supporting our dealer network and building Viper brand awareness. We will participate in leading consumer
and dealer trade shows, rallies and other motorcycle events. We also will engage in ongoing advertising and promotional activities
to develop and enhance the visibility of our Viper brand image.

11

Market and Sell Ancillary Viper Product

We intend to commence marketing and sales of a variety of ancillary
products under our Viper brand, particularly in the large custom cruiser aftermarket. We expect our primary aftermarket sales will
be our line of powerful Viper V-Twin engines, and by the middle of 2013 we anticipate obtaining substantial revenues from Viper
engine sales in this active aftermarket. We also will outsource production of ancillary Viper items from third-party suppliers
including various motorcycle parts and accessories, apparel, and other Viper branded merchandise. For example, we have obtained
a source to provide us with a line of Viper branded apparel. Our ancillary Viper products will be sold through multiple marketing
channels including Viper dealers, independent aftermarket catalogs and our website.

Market and Sell PMFR Product

The Company, through its newly acquired subsidiary PMFR, Inc.,
purchased the assets and business of Precision Metal Fab Racing on April 24, 2012. During the next twelve months, we will commence
marketing and sales of a variety of premium motorcycle products under the PMFR brands. These include frameworks, front ends, brake
systems, handlebars, triple trees, various chrome or polished wheels, mounts, swing arms and foot pegs utilized in the custom motorcycle
market. In addition, PMFR will continue to produce and sell it specialized components associated with various racing configurations.

Location of manufacturing operations

Viper Motorcycle Company is located in Auburn, Alabama. The
63,000 sq ft world class production facility is situated on 13 acres. The plant is large enough to produce up to 1,000 units per
year and can be expanded to a maximum footprint of 163,000 square feet.

Recent Activities

In July 2011, the Company completed the relocation of its entire
headquarters and manufacturing operations from Hopkins, Minnesota to Auburn, Alabama. With this move completed the Company is leasing
and occupying a modern state-of-the-art facility in Auburn which is currently being upgraded and customized to suit all of our
motorcycle development, marketing, production and administrative functions. This Auburn facility includes 63,000 square feet with
ample future expansion capability.

On April 24, 2012, the Company incorporated its subsidiary PMFR,
Inc. This subsidiary will manufacture high performance racing and custom motorcycle components and accessories. The PMFR purchase
included an established customer base that will continue to be a profitable business. In addition, the Company plans to reduce
its internal cost of purchasing by utilizing PMFR’s excess production capacity.

Results of Operations

Revenues

Beginning in 2012, the Company began the full production and
sale of motorcycles Future revenues will continue to increase from the sale of Viper premium motorcycles as we expand our dealer
network. In addition, we expected material sales of our proprietary engines in the aftermarket by the second quarter of 2013.

Our subsidiary PMRF, Inc. will continue to produce racing and
after-market parts for both external sale and internal consumption.

We believe our future revenue stream will be most significantly
affected by customer demand for Viper motorcycles, performance of our proprietary V-Twin engines, our ability to timely manufacture
our motorcycle products in response to dealer and customer orders, recruitment and retention of dealers and distributors who actively
promote and sell our products.

Operating Expenses

Research and development expenses consist primarily of salaries
and other compensation for development personnel, contract engineering costs for outsourced design or development, supplies and
equipment related to design and prototype development activities, and costs of regulatory compliance or certifications.

Selling, general and administrative expenses consist primarily
of salaries and other compensation for our management, marketing and administrative personnel, facility rent and maintenance, advertising
and promotional costs including trade shows and motorcycle rallies, sales brochures and other marketing materials, dealer recruitment
and support costs, development of accounting systems, consulting and professional fees, financing costs, public relations efforts
and administrative overhead costs.

12

Comparison of quarter ended September 30, 2012 and September
30, 2011.

Revenues

There was $370,274 of motorcycle and parts revenue for the third
quarter of 2012 as compared to $166,166 for the same period of 2011. There were six bike sales during this quarter of 2012 compared
to five bike sales during the same quarter of 2011. During this period of 2012, the Company significantly increase it wholesale
price of motorcycles.

Research and Development Expenses

Research and development for the quarter reported was $93,756
compared to $14,983 for the same period in 2011. This increase was due to increased development expenses related to current and
future models as the Company moved into full commercial production.

Selling, general and administrative expenses

Selling, general and administrative expenses decreased to $748,665
for thethird quarter of 2012 from $1,478,424 for the same quarter of 2011. Our 2011 selling and general administrative
expenses were higher primarily due to costs associated with our relocation to Auburn, AL in the summer of 2011.

Loss from operations

Operational loss for the third quarter of 2012 was $817,155
compared to $1,490,028 for the same quarter of 2011. This decreased loss in the third quarter of 2011 was due primarily to our
2011 selling and general administrative expenses being higher due to costs associated with our relocation to Auburn, AL.

Interest expense

Interest expense for thethird quarter of 2012 was
$335,761 compared to $5,324 for the same quarter of 2011. This increase during thethird quarter of 2012 was due to
interest related to the new long-term debt facility with Precious Capital LLC..

No income tax benefit was recorded regarding our net loss for
thethird quarters of 2012 and 2011; since we could not determine that it was more likely than not that any tax benefit
would be realized in the future.

Comparison of the nine months ended September 30, 2012
and September 30, 2011.

Revenues and Gross Profit

There was $655,073 of motorcycle and parts revenue for the first
nine months of 2012 as compared to $204,901 for the same period of 2011. There were eleven motorcycles sold the first nine months
of 2012 compared to five motorcycles sales in 2011.

Research and Development Expenses

Research and development for the first nine months of 2012 was
$172,441 compared to $19,139 for the same period of 2011. This increase was due to increased development expense as the Company
moved to finalize and produce its new model.

Selling, general and administrative expenses

Selling, general and administrative expenses for the first nine
months of 2012 were $2,691,172 compared to $2,621,550 for the same period in 2011. Our 2012 selling and general administrative
expenses included substantial expenses incurred in acquiring the new operating loan. The 2011 selling and general administration
included substantial expenses related to the relocation to Auburn and increased personnel cost at the new facility.

Loss from operations

Operational loss for the first nine months of 2012 was $2,830,666
compared to $2,644,780 for same period in 2011. This increase of the loss for the same period in 2011 was due to primarily to expenses
incurred in acquiring the new operating loan. The 2011 selling and general administration reflect the expenses of related to the
relocation to Auburn and increases in personnel cost.

13

Interest expense

Interest expense for thefirst nine months of 2012
was $655,089 compared to $40,744 for thesame period of 2011. This increase during the same period of 2011 was due to
new long-term debt of the Company.

Other expenses

The Company recognized accretion and financing charges during
the first nine months of 2012 of $461,088 and $729,768 compared to $83,304 and $183,566 during the same period of 2011. These charges
were the results of the conversion of loan instruments into equity.

No income tax benefit was recorded regarding our net loss for
thefirst nine months of 2012 and 2011; since we could not determine that it was more likely than not that any tax benefit
would be realized in the future.

We currently employ 16 persons including our management, production,
engineering, marketing and administrative personnel. We expect to hire 2-3 assembly and administrative personnel during the next
twelve months to support our anticipated commercial production and sales of Viper cruisers. Other than these additional anticipated
personnel, we do not anticipate needing any additional personnel during the next twelve months. None of our employees belong to
a labor union, and we consider our relationship with our employees to be good.

Liquidity and Capital Resources

As of September 30, 2012, we had cash resources of $41,051,
total liabilities of $4,148,972 and a positive working capital position of $621,576.

Future Liquidity

Based on our current cash position, we have concerns about our
ability to fund our ongoing operations. We anticipate obtaining additional needed financing through the proceeds from additional
private placement of equity securities.

If we are unable to complete proposed private equity placements
or to obtain substantial additional funding through another source, we most likely would need to curtail significantly, or even
cease, our ongoing and planned operations. Our future liquidity and capital requirements will be influenced materially by various
factors including the extent and duration of our future losses, the level and timing of future sales and expenses, market acceptance
of our motorcycle products, regulatory and market developments in our industry, and general economic conditions.

The report of our independent registered accounting firm for
our audited financial statements for the year ended December 31, 2011, states that there is substantial doubt about the ability
of our business to continue as a going concern.

Cash Flow Information

Net cash consumed by operating activities was $3,082,243 during
the nine months ended September 30, 2012 compared to consuming cash in the amount of $1,498,848 for the same period in 2011. This
increase is primarily associated with the financing cost from the new long-term debt and substantial increased inventory.

Net cash used from investing activities for the nine months
of 2012 of $715,885 as compared to $220,796 used during the same period in 2011. This increased cash use in 2012 is associated
with the purchase of assets of PMFR and the final engine development payment to Ilmor Engineering.

Cash generated from financing activities for the nine months
ended September 30, 2012 was $3,811,283 compared to $1,721,059 for the same period in 2011. This substantial increase is associated
with a new long-term loan entered into during 2012.

Business Seasonality

Sales of motorcycles in the United States are affected materially
by a pattern of seasonality experienced in the industry which results in lower sales during winter months in colder regions of
the country. Accordingly, we anticipate that our sales will be greater during spring, summer and early fall months than during
late fall and winter periods. We also expect our revenues and operating results could vary materially from quarter to quarter due
to industry seasonality.

14

Recent Accounting Pronouncements

In December 2011, the Financial Accounting Standards Board (“FASB”)
issued Accounting Standards Update (“ASU”) No. 2011-11, “Balance Sheet (Topic 210): Disclosures about Offsetting
Assets and Liabilities.” This ASU requires an entity to disclose information about offsetting and related arrangements to
enable users of its financial statements to understand the effect of those arrangements on its financial position. ASU No. 2011-11
will be applied retrospectively and is effective for annual and interim reporting periods beginning on or after January 1,
2013. The adoption of this ASU is not expected to have a material impact on the Company’s disclosures to the consolidated
financial statements.

In July 2012, FASB issued ASU
No. 2012-02, “Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment.” This
ASU simplifies the guidance for testing the decline in the realizable value (impairment) of indefinite-lived intangible assets
other than goodwill. ASU No. 2012-02 will be effective for annual and interim impairment tests performed after September 15,
2012. The adoption of this ASU is not expected to have a material impact on the Company’s disclosures to the consolidated
financial statements.

No other recently issued pronouncements are expected to have
a material impact on the Company’s financial reporting.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

15

Forward-Looking Statements

This quarterly report on Form 10-Q contains “forward-looking
statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Statements expressing
expectations regarding our future and projections we make relating to products, sales, revenues and earnings are typical of such
statements. All forward-looking statements are subject to the risks and uncertainties inherent in attempting to predict the future.
Our actual results may differ materially from those projected, stated or implied in our forward-looking statements as a result
of many factors, including, but not limited to, our overall industry environment, customer and dealer acceptance of our products,
effectiveness of our dealer network, failure to develop or commercialize new products, delay in the introduction of products, regulatory
certification matters, production and or quality control problems, warranty and/or product liability matters, competitive pressures,
inability to raise sufficient working capital, general economic conditions and our financial condition.

Our forward-looking statements speak only as of the date
they are made by us. We undertake no obligation to update or revise any such statements to reflect new circumstances or unanticipated
events as they occur, and you are urged to review and consider all disclosures we make in this and other reports that discuss risk
factors germane to our business, including those risk factors in our Form 10-K for the period ended December 31, 2011.

.

16

Item 3. Controls and Procedures

Evaluation of disclosure controls and procedures

As of September 30, 2012, management assessed the effectiveness
of our internal control over financial reporting. The Company's management is responsible for establishing and maintaining adequate
internal control over financial reporting for the Company. Internal control over financial reporting is defined in Rule 13a-15(f)
or 15d-15(f) promulgated under the Securities Exchange Act of 1934, as amended, as a process designed by, or under the supervision
of, the Company's Principal Executive Officer and Chief Financial Officer and effected by the Company's Board of Directors, management
and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with GAAP in the United States of America and includes those policies and procedures
that:

i)

Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and dispositions
of our assets;

ii)

Provide reasonable assurance our transactions are recorded as necessary to permit preparation of our financial statements in
accordance with GAAP, and that receipts and expenditures are being made only in accordance with authorizations of our management
and directors;

iii)

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our
assets that could have a material effect on the financial statements.

In evaluating the effectiveness of our internal control over
financial reporting, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission
("COSO") in Internal Control - Integrated Framework. Based on that evaluation, they concluded that, during the period
covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US
GAAP rules as more fully described below.

This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely
affected our internal controls and that may be considered to be material weaknesses.

The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards
of the Public Company Accounting Oversight Board were: (1) inadequate segregation of duties consistent with control objectives;
and (2) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses
were identified by our Chief Executive Officer and Chief Financial Officer in connection with the review of our financial statements
as of September 30, 2012.

Management believes that the material weaknesses set forth above
did not have an effect on our financial results.

Changes in internal controls

There were no changes in our internal control over financial
reporting that occurred during the last fiscal quarter of the period covered by this report that have materially affected or are
reasonably likely to materially affect our internal control over financial reporting.

17

PART II - OTHER INFORMATION

Item 6. Exhibits

See Index of Exhibits.

18

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duty authorized.

VIPER POWERSPORTS INC.

By:

/s/ Timothy C. Kling

Timothy C. Kling Principal Financial Officer

November 10, 2012

Auburn, Alabama

19

VIPER POWERSPORTS INC.

INDEX TO EXHIBITS

Form 10-Q for

Quarter Ended September 30, 2012

Commission File No. 000-51632

Exhibit

Number

Description

31.1

Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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